Dot tba financial plans

Day 1

Generic, short gTLDMost Likely Case Scenario

Wholesale Price $30This is an actual TLD financial plan that has been altered to protect the

privacy of the owner(s)

Registration Volume

Who is your target market?Are there synergies with other TLDs and markets?

How are you going to reach them?

How many existing domains exist with the term in them? What percentage will purchase a new name with the same term in them?

Considerations:• Price Point• Availability of alternatives• Penetration rate by year• Renewal rates

Generic Short TLDProjected Cash Flows Year 1 Year 2 Year 3

Most Likely

Part A: Generic Market A 1,764 1,848 1,296 Part B: Recreation 8,271 9,648 8,100 Part C: Sports 1,161 1,223 856 Part D: Educational 432 476 349 Part E: Specialty Deals 3,744 4,725 4,410 Part F: Existing Domains 711 713 357

Registration Volume in YearsOpening Balance - 23,932 60,947 New Additions 23,932 37,015 43,518

Total Registration Volume in Years 23,932 60,947 104,464

Sunrise 300 - - Landrush 700 - - # Purchases 17,208 29,977 35,307 Premium Domains: 1,125 1,456 1,488

23,932 37,015 43,518

Total sales are 16,084 yet new additions are 23,932 – Why?

Cash InflowsAs registrations may be for more than a year, the number of domains years can be higher than the number of purchases i.e. EGYPT.HOTEL is registered for 5 years

Premium names sell at a higher than normal prices and may have higher than normal renewal prices i.e. invisible.ink

Sunrise registrations are registrations from trademark holders which often includes an application fee

Registry Fee is an expense for the backend platform to manager the domains. The fee varies based on numerous service & volume factors


Most Likely

Domains Under Management 18,268 48,245 83,552 Registration Volume in Domain Years 23,932 60,947 104,464

Cash InflowsRegistrations 589,832 1,061,472 1,317,371 Premium Name Auctions (New & Renewals) 431,250 191,563 61,891 Sunrise Registrations 118,000$ -$ -$ Landrush Registrations 1,464$ -$ -$ Other Cash Inflows - interest 31,450 48,836 68,061 Best ONLY Revenue streams - - -

Total - Cash Inflows 1,171,996$ 1,301,870$ 1,447,323$

Total Cash Outflows:

Cost of Sales (cash)Registry Fee - Per Domain 77,779 120,299 140,316 ICANN Fees - Quarterly Fixed 185,000 25,000 25,000 25,000 ICANN Fees - trx fee - Var - - - Premium Name Fees 47,438 15,813 -

Total 150,217$ 161,112$ 165,316$

Gross Margin (cash Sales Basis) 1,021,780$ 1,140,759$ 1,282,007$

Cash Outflows – COS & LaborLabour varies depending on existing company resources, focus, mission, sales efforts, backend provider services

Marketing costs vary depending on how the registry plans on reaching its end users. This TLD plans on attending trade shows, banners on niche websites

Legal fees are nominal due to the open registry policies requiring minimal policing

This TLD is expecting to be profitable in every year


Labor: Cost of Living Adj?

Marketing Yes 80,000 72,000 73,800 75,645 Customer Service Yes 50,000 45,000 50,000 51,250 Admin Yes 50,000 45,000 50,000 51,250

Total Labour 162,000 173,800 178,145

Marketing Costs - Var No 500,000 300,000 300,000 200,000

General & Admin Yes 50,000 45,000 45,000 115,000

Professional Fees - Legal Yes 24,000 24,000 18,000 16,605

Other: COI Costs No 1,000 1,000 1,000 1,000 Other: Escrow: Fixed Yes One-Time 2,000 - -

Other: Escrow Variable Yes 0% 5,000 11,400 19,000 - Total Operating Cash Outflows 539,000 549,200 529,750

Taxes - - -

Total Operating Cash Outflows 689,217$ 710,312$ 695,066$

Projected Net Operating Cash Flow (cash basis) 482,780$ 591,559$ 752,257$ Cumulative 1,074,338$ 1,826,595$

Generic, short word gTLD

Worst Case ScenarioWholesale Price $25

(Note: Wholesale price change $30 in the most likely case based on the assumption that consumers are price sensitive)

Registration Volume Generic Short TLD

Projected Cash Flows Year 1 Year 2 Year 3

Worst

Part A: Amusement 1,323 1,236 648 Part B: Recreation 5,508 9,648 12,156 Part C: Sporting 873 1,427 1,712 Part D: Educational 270 556 786 Part E: Specialty Deal 2,250 4,200 5,513 Part F: Existing Domains 711 713 357



Sunrise 1,000 - - Landrush 60 - - # Purchases 12,060 26,280 38,653 Premium Domains: 1,125 1,456 1,488 Total 17,291 32,245 47,835

Similar to the most likely scenario with a decrease in volume ~11k resulting in 17k in domain name registrations (prior was 16k and 24k in registrations)

Notice in year 2 the New Additions is 32k yet there are only 17k new sales.

Is this an error?

How TLDs Vary from Other Businesses – Cash Cow Effect• Payment is upfront for a registration (no risk of payment)• For accountants, revenue recognition is a portion of the

registration fee each month i.e. a $12 registration fee is $1 in recognized revenue per month• Hence, most new TLD Owners evaluate the business based on

cash flows• Reoccurring revenues from renewals will occur in year two

which is one of the key benefits of owning a TLD. Cash Cow!

Cash InflowsCash inflows decrease due to the lower registration volume and price

Cost of sales decrease from $150k to $129k – related to registry fees

Gross margin decreases by $236k – no real magic.


Worst

Projected Cash Inflows & OutflowsDomains Under Management 13,120 39,400 78,053 Registration Volume in Domain Years 17,291 49,536 97,370

Cash InflowsRegistrations 334,194 765,900 1,210,564 Premium Name Auctions (New & Renewals)431,250 191,563 61,891 Sunrise Registrations 118,000$ -$ -$ Landrush Registrations 1,464$ -$ -$ Other Cash Inflows - interest 29,050 36,419 43,546 Best ONLY Revenue streams - - -

Total - Cash Inflows 913,958$ 993,881$ 1,316,001$


Cost of Sales (cash)Registry Fee - Per Domain 56,196 104,796 155,462 ICANN Fees - Quarterly Fixed 25,000 25,000 25,000 Premium Name Fees 47,438 15,813 -

Total 128,634$ 145,609$ 180,462$

Gross Margin (cash Sales Basis) 785,324$ 848,273$ 1,135,539$

Cash Outflows – COS & Labor

This registry believes their TLD marketing is related to the volume of registrations and increases their marketing labour.

Marketing costs increases from the most likely scenario with $300k in yr 1 & 2 and $200k in yr 3;

Escrow fees decline minimally due to the decreased in registrations


Labor:CEO/Manager -$ -$ -$ Marketing 135,000 138,375 141,834 Customer Service 36,000 40,000 41,000 Admin 36,000 40,000 41,000

Total Labour 207,000 218,375 223,834

Marketing Costs - Var 300,000 350,000 400,000

General & Admin 45,000 45,000 115,000

Professional Fees - Legal 24,000 15,000 12,000

Other: COI Costs 1,000 1,000 1,000 Other: Escrow: Fixed 2,000 - -

Other: Escrow Variable 4,250 8,700 16,800

Miscellaneous - - - - Total Operating Cash Outflows 583,250 638,075 768,634

Taxes - - -

Total Operating Cash Outflows 711,884$ 783,684$ 949,097$

Discounted Ooperating Cash Outflows 674,615$ 672,862$ 736,961$

Projected Net Operating Cash Flow (cash basis)202,074$ 210,198$ 366,904$ Cumulative 412,272$ 779,176$

Year 1 Year 2 Year 3 Year 4 Year 5

-$400,000

-$200,000

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

5 Year Projections

Total - Cash Inflows

Total - Recognized Revenue

Gross Margin (accounting sales basis)

Total Operating Cash Outflows

Net Income

Linear (Net Income)

Generic TLD 5 Year View

gTLD Focus on the Food & Restaurant

IndustryWholesale Price $15Worst Case Scenario

In this worst case scenario, management has chosen to minimize expenses and not invest in additional marketing activities to increase registrations

Registration Volume

This TLD is within the food and restaurant industry and plans to target specific niche’s within the industry.

Certain exporters are related to a specific geographic area within the world.

This TLD is also more expensive as it was in Contention (more than one applicant applied for it) and was auctioned off to the winner who paid the most in auction

Restaurant/Food TLDProjected Cash Flows Year 1 Year 2 Year 3

Worst

Part A: Restaurant/Food Industry 4,790 5,628 5,520 Penetration Rate# of Purchases 3,830 4,502 4,416

Part B: Speciality Restauranats 11,280 12,852 12,216 Penetration Rate# of Purchases 9,020 10,282 9,773

Part C: Producers/Exporters 830 950 903 Penetration Rate# of Purchases 660 760 722

Part D: Specialty Niche Target Rest. 520 533 451 Penetration Rate# of Purchases 410 427 361

Part E: Existing Domains 7,750 8,138 7,120 Penetration Rate# of Purchases 6,200 6,510 5,696

Cash InflowsAs purchasers can buy a domain name for more than one year, the number of domains in years can be higher than the number of names purchased

Sunrise registrations is the preregistration from trademark holders which often includes an ‘application fee’

Premium names sell at a higher price and can also renew at this higher price.


WorstTotal Registration Volume in Years 29,005 74,959 129,584

Sunrise 400 - - Landrush 2,500 - - # Purchases 20,270 35,791 42,536 Premium Domains: 150 178 176

29,005 45,954 54,626


Cash InflowsRegistrations 368,943 650,703 774,003 Premium Name Auctions (New & Renewals)375,000 512,750 765,088 Sunrise Registrations 27,600$ -$ -$ Landrush Registrations 61,000$ -$ -$ Other Cash Inflows - interest - - - Best ONLY Revenue streams - - -

Total - Cash Inflows 832,543$ 1,163,453$ 1,539,091$


ICANN Fees are a minimal of $25k/yr with a charge of $.25 per year when the volume exceeds 50,000 names

Premium name fees are the commissions paid to the seller of the premium name

Labour varies depending on the company, existing resources, purpose of the TLD, etc.

Restaurant/Food TLD Start-UpProjected Cash Flows Costs Year 1 Year 2 Year 3


Cost of Sales (cash)Registry Fee - Per Domain 113,768 168,583 193,696 ICANN Fees - Quarterly Fixed 185,000 25,000 25,000 25,000 ICANN Fees - trx fee - Var - - - Premium Name Fees 41,250 55,000 82,500 Misc. Fees 10,683 95,211 32,201

Total 190,701$ 343,794$ 333,397$

Gross Margin (cash Sales Basis) 641,842$ 819,659$ 1,205,694$ Labor:

CEO/Manager 100,000 100,000$ 100,000$ 100,000$ Marketing Director 100,000 90,000 92,250 94,556 Customer Service 80,000 73,542 153,897 Technical Director 102,000 91,800 118,008 172,650 Expenses - Best ONLY - - -

Total Labour 361,800 383,800 521,103

Cash Outflows & Net Income


Marketing Costs - Var No 200,000 200,000 300,000 250,000

Senior Security Consultant Services Yes 100,000 90,000 99,000 108,900

General & Admin Yes 115,000 103,500 125,500 115,000

Professional Fees - Legal Yes 250,000 250,000 256,250 236,391

IP Clearninghouse No - 70,000 - -

Other: COI Costs No 1,000 1,000 1,000 1,000

Other: Escrow: Fixed Yes One-Time 2,500 - -

Other: Escrow Variable Yes 0% 7,850 11,000 13,750

Miscellaneous No 25,000 25,000 25,000 25,000

Debt Payment - - - -

Total Operating Cash Outflows 1,111,650 1,201,550 1,271,144

Taxes - - -

Total Operating Cash Outflows 1,450,351$ 1,645,344$ 1,804,541$

Discounted Operating Cash Outflows 1,380,010$ 1,413,188$ 1,403,128$

Projected Net Operating Cash Flow (cash basis) (469,808)$ (381,891)$ (65,450)$ Cumulative (851,698)$ (917,148)$

To date, marketing of new gTLDs has not been significant and its impact on volume is difficult to predict

Security costs vary by TLD and their mission i.e. the impacts of satan.bible could have severe impacts while other registries believe in free speech with no related security and legal costs

In the worst case, this TLD is losing money in years 1 to 3

gTLD Focus on the Food & Restaurant

IndustryWholesale Price $15

Most Likely Scenario.diet, .fish, .farm, .pizza

Registration VolumeRestaurant/Food TLDProjected Cash Flows Year 1 Year 2 Year 3

Most Likely

Part A: Restaurant/Food Businesses 4,790 5,628 5,520 Penetration Rate# of Purchases 4,790 5,628 5,520

Part B: Speciality Restaurants 11,280 12,852 12,216 Penetration Rate# of Purchases 11,280 12,852 12,216

Part C: Producers/Exporters 830 950 903 Penetration Rate# of Purchases 830 950 902

Part F: Speciallty /Niche Restaurants 520 533 451 Penetration Rate# of Purchases 520 533 451

Part G: Existing Domains 7,750 8,138 7,120 Penetration Rate# of Purchases 7,750 8,137 7,120



This TLD is within the food and restaurant industry and plans to target specific niche’s within the industry.

Certain exporters are related to a specific geographic area within the world.

This TLD is also more expensive as it was in Contention (more than one applicant applied for it) and was auctioned off to the winner who paid the most in auction

Cash Inflows


Most LikelySunrise 650 - - Landrush 4,500 - - # Purchases 25,320 45,664 53,644 Premium Domains: 150 178 176

37,769 58,690 68,955


Cash InflowsRegistrations 461,546 831,747 977,690 Premium Name Auctions (New & Renewals)375,000 512,750 765,088 Sunrise Registrations 44,850$ -$ -$ Landrush Registrations 109,800$ -$ -$ Other Cash Inflows - interest - - - Best ONLY Revenue streams - - -

Total - Cash Inflows 991,196$ 1,344,497$ 1,742,778$

Resulting increased registrations of ~8,800 registrations in yr 1; ~12,700 in year 2 & Year 3 ~15,300

Results in an increase of over $543k over three years

Reflects the simple equation that the volume and price of registrations is key!

Cash Outflows – COS & LaborCost of sales have nominal changes

However, increase to labour due to the increased registrations and efforts

In some cases, registries have decided to build out some of their own domain names for increased revenues and expenses via a separate corporation


Most LikelyCost of Sales (cash)

Registry Fee - Per Domain 146,635 213,119 241,698 ICANN Fees - Quarterly Fixed 185,000 25,000 25,000 25,000 Premium Name Fees 41,250 55,000 82,500 Other Fees 40,000 58,000 64,098

Total 300,885$ 351,119$ 413,296$



CEO/Manager Yes - 100,000$ 100,000$ 100,000$ Marketing Director Yes 200,000 100,000 105,000 110,125 Customer Service Yes 150,000 150,000 173,542 253,897 Technical Director Yes 102,000 102,000 118,008 172,650 Expenses - Best ONLY No - - -

Total Labour 452,000 496,550 636,672


Most LikelyCost of Sales (cash)

Registry Fee - Per Domain 146,635 213,119 241,698 ICANN Fees - Quarterly Fixed 185,000 25,000 25,000 25,000 Premium Name Fees 41,250 55,000 82,500 Other Fees 40,000 58,000 64,098

Total 300,885$ 351,119$ 413,296$



CEO/Manager Yes - 100,000$ 100,000$ 100,000$ Marketing Director Yes 200,000 100,000 105,000 110,125 Customer Service Yes 150,000 150,000 173,542 253,897 Technical Director Yes 102,000 102,000 118,008 172,650 Expenses - Best ONLY No - - -

Total Labour 452,000 496,550 636,672

Cash Outflows & Net Income Escrow Fees have both a fixed and variable portion to them

Some TLDs have investors or loans that require repayment


Marketing Costs - Var 300,000 350,000 300,000

Senior Security Consultant Services 100,000 110,000 121,000

General & Admin 115,000 127,354 146,390


IP Clearninghouse 70,000 - -



Miscellaneous 25,000 25,000 25,000

Debt Payment - - - - Total Operating Cash Outflows 1,323,950 1,377,754 1,481,453

Taxes - - -


Discounted Ooperating Cash Outflows 1,544,745$ 1,482,846$ 1,471,100$

Projected Net Operating Cash Flow (cash basis)(633,639)$ (384,376)$ (151,971)$

Current ProjectDelegation to occur this weekSunrise in AprilGeneral Availability in June

Generic but has niche markets

Registration VolumeActual industry size and penetration rates have been hidden but the volume projections by market are shown

.LOVE is doing an Early Launch Program instead of Landrush which is different from other examples, it also gets the TLD into General Availability faster.

Projected Cash Flows Year 1 Year 2 Year 3

Most Likely

Part A: Romance & Occasions 2,061 2,880 3,024 Part B: Passions 1,125 3,984 8,472 Part C: Literature 1,422 1,938 1,977 Part D: Hobbies, Places, People 1,872 2,750 3,025 Part E: Dating 9,369 11,813 11,025 Part F: Wedding & Love Story 4,500 6,600 7,260 Part G: Existing Domains 3,312 10,935 21,652 Part H: Existing Domains ending w/ .LOVE 1,836 2,335 2,219



.LOVEProjected Cash Flows Year 1 Year 2 Year 3

Most Likely

Sunrise 2,000 - - Landrush - - - # Purchases 25,735 57,424 92,079 Premium Domains: 238 217 184

34,451 67,768 108,861


Cash InflowsRegistrations 730,394 1,632,987 2,627,161 Premium Name Auctions (New & Renewals)191,667 48,427 9,217 Sunrise Registrations 236,000$ -$ -$ Landrush Registrations -$ -$ -$ Other Cash Inflows - interest - - - Best ONLY Revenue streams - 1,800 3,780

Total - Cash Inflows 1,158,060$ 1,681,414$ 2,636,379$

Cash InflowsWe are targeting June as we would prefer not to launch in the summertime when the cyclical nature of domain registrations is lower

Premium name numbers have been altered for confidentiality purposes

One target market has additional revenue streams that we hope to roll out to add additional benefits to domain buyers


Registrar Fees is for an expected promotion program to have users build a website and in return, receive a reduction in fees.

Once someone builds a website, they are more likely to renew the domain name in future years



Cost of Sales (cash)Registry Fee - Per Domain 75,793 149,090 239,495 ICANN Fees - Quarterly Fixed 25,000 25,000 25,000 Premium Name Fees 21,083 4,217 - Registrar Fees 73,039 163,299 262,716

Total 194,916$ 341,605$ 527,211$

Gross Margin (cash Sales Basis) 963,144$ 1,341,609$ 2,112,948$

Labor:CEO/Manager -$ -$ -$ Marketing 150,000 153,750 157,594 Customer Service 40,000 40,000 41,000 Expenses - Best ONLY - - -

Total Labour 190,000 193,750 198,594

Cash Outflows & Net IncomeMarketing expenditures targeting the areas with large volumes are in place along with general TLD awareness with other TLDs

Lean organization with the utilizing of existing business resources

In the most likely scenario, all three years are profitable with increases in year 2 & 3 due to the cash cow affects


Total Cash Outflows:Marketing Costs - Var 500,000 400,000 300,000

Outsourcing 30,000 30,000 30,000

General & Admin 50,000 50,000 146,390


Travel 75,000 75,000 75,000



Miscellaneous 8,000 8,000 8,000 - Total Operating Cash Outflows 885,925 797,625 800,984

Taxes - - -


Projected Net Operating Cash Flow (cash basis)77,219$ 543,984$ 1,311,964$ Cumulative 621,203$ 1,933,167$

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